At 15,56,777 units, auto sales increase by 34pc in July 2021: FADA

According to the latest retail data provided by the Federation of Automobile Dealers Associations (FADA), total vehicle retails for the month of July 2021 have increased by 34.12% on year on year basis. When compared to July’19 (a regular pre-covid month), the recovery is visible as the deficit reduces to low double digits of -13.22%.

Also, on YoY basis, all categories were in green with 2W up by 28%, 3W up by 83%, PV up by 63%, Tractor up by 7% and CV up by 166%.

After tractors, PV for the first time shows strong numbers by clocking 24% growth when compared to pre-covid month of July’19.

But despite this euphoria, FADA has been raising a red flag about semi-conductor shortage for quite some time. The situation is now becoming grave with ever-increasing supply-side constraints.

Also, the Delta variant of covid and a possibility of 3rd wave continue to remain a threat for stable auto retails, feels FADA.

FADA President Vinkesh Gulati said, “With entire country now open, July continues to see robust recovery in Auto Retails as demand across all categories remain high. The low base effect also continues to play its part. With all categories in green, CV’s continue to see increase in demand specially in M&HCV segment with the Government rolling out infrastructure projects in many parts of the country,”.

“PV’s witnesses high demand specially with buzz around new launches and compact SUV segments. The

waiting period due to supply side constraints have been persisting since quite a few months and is now becoming a deep routed issue for OEM’s,” he cautioned.

“The 2W segment though continues to see positive demand YoY, the rate of recovery remains sluggish as customers at the bottom of the pyramid suffer with poor disposable income and rural markets where covid cases were high during the 2nd wave,” he noted.

Auto Retails have now started narrowing the deficit when compared to pre-covid months. When

Near Term Outlook

The month of August begins on a positive note as demand and enquiry levels continue to improve across all categories. With IMD forecasting a normal monsoon during August- September period, sowing operations will pick up gradually. This will have a rub off effect on rural sales especially in Tractor segment, said FADA.

On the other hand, the global semi-conductor shortage is now becoming a deep routed problem for the PV segment which is now above the pre-pandemic mark. FADA has been raising red-flag since quite some time on demand-supply mis-match.

In an internal survey conducted by FADA, 60% Dealers of PV segment said that they have at least 2

months waiting period for select variants, while 35% Dealers also said that the waiting period is more than 4 months among select variants.

All India Vehicle Retail Data for July’21

Source: FADA Research

Disclaimer:

1- The above numbers do not have figures from AP, MP, LD & TS as they are not yet on Vahan 4.

2- Vehicle Retail Data has been collated as on 07.08.21 in collaboration with Ministry of Road Transport & Highways,

Government of India and has been gathered from 1,305 out of 1,519 RTOs.

3- CV is subdivided in the following manner

a. LCV – Light Commercial Vehicle (incl. Passenger & Goods Vehicle)

b. MCV – Medium Commercial Vehicle (incl. Passenger & Goods Vehicle)

c. HCV – Heavy Commercial Vehicle (incl. Passenger & Goods Vehicle)

d. Others – Construction Equipment Vehicles and others